Filed under: Television, Housing

If you’ve watched any of those awful late-night real estate investment infomercials, you’ve heard of cash-back-at-closing real estate deals. You know, the ones where the guy with the buckteeth holds up the check for $11,000 and says, “I bought a house with no money down and got $11,000 back at closing!”

In an excellent article on RISMedia, Ralph R. Roberts explains how these schemes work and why they’re so bad for the real estate industry:

On its surface, cash back at closing seems to benefit everyone involved. The buyer pockets some extra cash. The seller unloads his house at or near the asking price. The real estate agent gets a bigger commission. The loan officer chalks up another successful loan. And the lender stands to earn more interest over the life of the loan. Everybody wins.

Continue reading How cash-back-at-closing schemes hurt the real estate market

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This entry was posted on Thursday, December 6th, 2007 at 8:42 am and is filed under Stocks Money News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.